The IRS business code for a roofing company is 238160, listed as “Roofing contractors” on the Schedule C chart. A sole owner or single-member LLC enters it on Schedule C, line B. The harder part is the year-end bill, which stays small only if you pay self-employment and income tax in estimated payments through the year.
The rules below come from IRS and Texas Comptroller pages read in October 2026.
Use the code for the work that brings in most of your income
The IRS bases its codes on the North American Industry Classification System and asks for the one that describes your principal source of income. The same chart gives nearby trades their own codes, such as 238170 for siding contractors and 238390 for other building finishing contractors.
If roofs bring in most of your money, 238160 is your code even with some siding work on the side. A partnership or corporation reports its business code on its own return instead of Schedule C. Ask whoever files your return which code they used last year, and change it only if most of your income now comes from different work.
Self-employment tax adds 15.3% on top of income tax
Under a YouTube video about a first-year roofing owner, one viewer asked “what causes a business to end up with a huge tax bill like that.” Part of the answer is self-employment tax: 12.4% for Social Security plus 2.9% for Medicare, owed on top of income tax.
You owe it once net earnings from self-employment reach $400, and you report it on Schedule SE. If nothing is withheld from your draw and you make no payments during the year, all of it lands on one return.
You can deduct the employer-equivalent half of it when you figure adjusted gross income. The Social Security part also stops at a yearly earnings cap, which the IRS lists as $168,600 for 2024. Plan for both taxes from the first job of the year, since the IRS expects them in four payments.
Quarterly payments are due in April, June, September and January
Individuals generally have to pay estimated tax if they expect to owe $1,000 or more when they file, and corporations at $500. Owners pay on Form 1040-ES, and the four periods are uneven:
- Income earned January through March is due April 15.
- Income earned in April and May is due June 15.
- Income earned June through August is due September 15.
- Income earned September through December is due January 15 of the next year.
A due date that falls on a weekend or holiday moves to the next business day. The June payment covers only two months, so a roofer whose storm season runs in spring can owe a large payment on a short period.
You avoid the underpayment penalty if you paid at least 90% of this year’s tax or 100% of last year’s, whichever is smaller. When storms make this year’s income hard to guess, last year’s total is the easier target, because you already know it.
The IRS estimated-tax page sends readers to chapter 2 of Publication 505 for the full rule, so read it before you count on last year’s total.
Any shortfall is figured on Form 2210. The IRS can waive the penalty when a disaster or another unusual event caused the underpayment. Disaster relief is declared for each event and area, so don’t assume a hailstorm in your county qualifies.
A 1099 roofing sales rep on Reddit said to “set aside 30% for quarterly tax obligations.” That figure came from a sales rep, so size your own share from last year’s return. Move it into a separate account the day each final check clears, and pay each quarter from that account so the payment never comes out of next week’s materials money.
Bookkeeping and QuickBooks for a Roofing Company, Including Job Costing
On a Texas home roof, the contract type decides who pays tax on materials
Every state taxes contractors differently, and the rules in this section and the next apply in Texas only. They come from the Comptroller’s Publication 94-116 on repair and remodeling. In Texas, labor to repair or remodel a home is not taxable. Apartment complexes and condominiums count as homes, while hotels and stays under 30 days don’t.
How you price the job decides the rest:
- Lump-sum contract (one price for the whole job): you pay sales tax on materials when you buy them, and you don’t charge the homeowner tax.
- Separated contract (materials and labor priced separately): you give your supplier a resale certificate and collect state and local sales tax from the homeowner on the materials charge. Labor stays untaxed, and you need a sales tax permit to collect.
A commenter under a Roofing Insights pricing video asked whether a roofing company can charge tax on the final invoice. On a Texas home, that only applies to a separated contract, and only to the materials line. If you write lump-sum contracts, pay the tax at the supply house and leave it off the homeowner’s invoice. Outside Texas, look up how your state’s revenue department taxes contractors before you build your invoice template.
Texas taxes commercial reroofing on the whole charge
Repair and remodeling of nonresidential property in Texas is taxable on the total charge, labor included, and the Comptroller names reroofing as an example. The only part left out is a building permit fee paid for the customer and stated separately on the invoice. New construction is the exception, because labor on it is not taxable.
A roofer who does both residential and commercial work handles tax two ways. Set up a commercial invoice that taxes the full total, and keep the residential one matched to the contract type.
Equipment write-offs and a 20% deduction on business income can lower the bill
Bonus depreciation is back at 100% for qualified property acquired and placed in service after January 19, 2025. That covers trucks and trailers bought for the business, so the full cost can come off in the year you put it to work. Passenger vehicle limits still apply, so check them before you count on writing off a whole truck.
The qualified business income deduction, which takes 20% of qualified business income off your taxable income, is now permanent. It also has a new minimum deduction of $400 for owners with at least $1,000 of qualified business income from a business they actively run. Income limits and phase-outs apply.
If you already plan to buy a truck or trailer, ask your CPA before December 31 which tax year the purchase should land in.
A draw or an S corp is a question for a CPA with your numbers
One roofing owner on Reddit asked “should we pay ourselves a good draw or should we leave this money in the account.” A partner in another post asked whether to file as a partnership or an S corp. Take both questions to a CPA before the year ends, with last year’s return and this year’s books.
Do these six things before the next due date
- Check that Schedule C, line B carries the roofing code if roofing brings in most of your income.
- Open a separate tax account and move a share of every final check into it when the check clears.
- Put the four estimated tax dates on the office calendar, and aim to pay at least last year’s total tax across them.
- Check your state’s sales tax rules for contractors. In Texas, pick lump-sum or separated contracts and invoice to match.
- Skip the 1099-NEC for a sub you pay less than $2,000 in 2026, up from $600 the year before. Roofing Contracts and 1099 Rules: What a New Owner Needs in Writing
- Before December 31, ask your CPA about equipment purchases and the draw-or-S-corp question.
Those four payments are easier to plan when work comes in evenly, and some of that work starts with a homeowner finding you on Google Maps. If you want to see where you stand, our free Google Maps heatmap lets you pick your Google profile and a search, and in a few minutes it shows your rank at 49 points around your office.